September 1, 2014

SABS Update- A Line In The Sand: Further Insurer CAT Assessments Refused

Allen and Security National
FSCO A12-003800


Miguel Allen was seriously injured in a motor vehicle accident on September 5, 2008. He submitted an application for determination of catastrophic impairment in 2011. His application was accompanied by a supporting report which assessed his whole person impairment (WPI) percentage at 39% to 56%. Shortly thereafter, the insurer arranged a multi-disciplinary catastrophic assessment and responded with an evaluation report which assessed Mr. Allen’s WPI at 35%. On this basis, Mr. Allen’s application for a determination of catastrophic impairment was denied.

In late 2012, Mr. Allen provided a responding evaluation report which assessed his WPI at 54% to 58%; however, the insurer denies that it was provided with a copy of this report until March 2014, days prior to a scheduled preliminary issue hearing. Counsel for Mr. Allen agreed to an adjournment of the hearing as an indulgence. After receiving agreement on the adjournment, the insurer scheduled six assessments in order to respond to the 2012 report. Mr. Allen refused to attend the assessments, arguing that the proposed assessments were not reasonably necessary

The insurer brought this motion which was heard before arbitrator Anne Morris on July 28, 2014. The primary issues were whether the assessments proposed by the insurer are reasonably necessary and whether procedural fairness requires the proceedings to be stayed pending the assessments.



Arbitrator Morris found that the assessments proposed by the insurer were not reasonably necessary and that procedural fairness does not require the proceedings to be stayed pending the assessments.



A review of correspondence suggests that the responding evaluation report, which is referenced in subsequent correspondence, was served in November 2012. On this basis, arbitrator Morris was unable to conclude that counsel for Mr. Allen intentionally withheld or failed to disclose the existence of the report or that she was even aware that counsel for the insurer was unaware of the report.

In determining whether the insurer assessments are reasonably necessary, arbitrator Morris reviewed State Farm Automobile Insurance Company and Ramalingam in which the Director’s Delegate provided a list of objective factors to be considered. In particular, she looked at whether information provided by Mr. Allen since the insurer’s last examination suggested a new diagnosis, change in condition or new direction in medical investigation.

In a review of the 2011 and 2012 reports, arbitrator Morris notes that Mr. Allen’s physical and psychiatric condition does not appear to change and that the differences in ratings between reports can be attributed to methodology rather than changes in medical condition. She also found insufficient evidence of a material change in Mr. Allen’s condition between 2012 and present. It was her conclusion that the merits of the methodologies could be argued at the hearing without the necessity of further insurer assessments. Accordingly, the insurer’s motion was denied.



While there are a number of factors to consider, one of the key factors in determining whether further assessments are required will be whether the insurer can produce evidence of a change in medical condition. Insurer assessments are a significant undertaking for a claimant and can also stand to delay the progress of a claim. This decision, which places the onus on the insurer to produce evidence of a change in medical condition, gives claimants footing to decline unreasonable and unnecessary assessments.

This decision encourages both insurers and claimants to consider carefully whether an assessment is reasonably necessary before insisting upon or agreeing to submit for the assessment. Ideally, this will reduce the number of unreasonable or unnecessary assessments and result in a more efficient process.


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